Who is the recipient of the sourcing fee payment for a Bft franchise?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
(which shall be paid in addition to the Initial Franchise Fee due under the Franchise IN WITNESS WHEREOF, the parties have executed and delivered this Sourcing Fee Addendum to be | | BFT FRANCHISE SPV, LLC, | "FRANCHISEE" | | a Delaware limited liability company | [if an individual] | | By: | | | Name: | [Name], individually | | Title: | | | Date: | Sign: Date: [if a legal entity] [Name], a [state/type] By: Name: | Title: _________________________________ Date: _________________________________
EXHIBIT L-2
MULTI-UNIT AGREEMENT SOURCING FEE ADDENDUM
EXHIBIT L-2 MULTI-UNIT AGREEMENT SOURCING FEE ADDENDUM (BFT)
| and between | BFT FRANCHISE SPV, LLC, a Delaware limited liability company with its principal business |
|---|---|
| address at 17877 | Von Karman Ave., Suite 100 Irvine, CA 92614 ("Franchisor"), and |
| , whose principal business address is | |
| ("Developer"). | |
| 1. , 20 this Sourcing Fee Unit Agreement. | Background. Developer and Franchisor are parties to that certain Multi-Unit Agreement dated (the "Multi-Unit Agreement") that has been signed concurrently with the signing of Addendum. This Sourcing Fee Addendum supersedes any inconsistent or conflicting provisions of the Multi-Unit Agreement. Terms not otherwise defined in this Sourcing Fee Addendum have the meanings as defined in the Multi-Unit Agreement. This Sourcing Fee Addendum is annexed to and forms part of the Multi |
| 2. | Sourcing Fee. Developer (and/or its affiliate(s)) currently operates an existing BFT Studio, and |
| in connection with the grant of the Development Rights under the Multi-Unit Agreement, a commission is owed | |
| to a third-party franchise broker based on a previously-made introduction to Franchisor or its affiliates. | |
| Accordingly, Developer agrees to pay, on its execution of the Multi-Unit Agreement, a non-refundable sourcing | |
| fee in the amount as follows (check as applicable): | |
| If Developer is acquiring Development Rights a Multi-Unit Agreement for the right to open two (2) | |
| additional BFT Studios, then the sourcing fee will be $40,000 (which is due in addition to the | |
| Development Fee). | |
| If Developer is acquiring De |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, the sourcing fee is paid to a third-party franchise broker. This fee is applicable when a commission is owed to the broker based on a prior introduction to Bft or its affiliates, specifically in connection with the grant of Development Rights under the Multi-Unit Agreement. The sourcing fee is non-refundable and is due upon the execution of the Multi-Unit Agreement.
The amount of the sourcing fee varies depending on the number of additional Bft studios the developer is authorized to open under the Multi-Unit Agreement. For instance, if the developer gains the right to open two additional Bft studios, the sourcing fee is $40,000. If the agreement covers three additional studios, the fee is $50,000. For six additional studios, the fee increases to $84,000, and for ten additional studios, it reaches $120,000. These fees are in addition to the standard Development Fee.
Prospective Bft franchisees should be aware of this potential sourcing fee, especially if they have been introduced to Bft through a franchise broker. It's important to clarify with Bft and the broker whether a commission is applicable in their specific case to avoid unexpected costs. Understanding the terms of the Multi-Unit Agreement and the Sourcing Fee Addendum is crucial for developers planning to expand their Bft franchise operations.